Obama unveils 54.5 mpg standard

July 29, 2011
President Barack Obama officially unveiled the new federal fuel-economy standards for cars and light-duty trucks, including vehicles such as the Ford F-150

President Barack Obama officially unveiled the new federal fuel-economy standards for cars and light-duty trucks, including vehicles such as the Ford F-150.

After receiving pressure from environmental groups as well as the automakers, the Obama Administration reached a settlement with all parties that will require all cars and light-duty trucks to achieve a standard 54.5 mpg by model year 2025. GM, Ford, Chrysler, Toyota, Nissan, Honda, Hyundai, BMW, Volvo, Mazda, Mitsubishi and Jaguar all attended the official announcement this morning in Washington, DC.

“This agreement on fuel standards represents the most important step we’ve ever taken as a nation to reduce our dependence on foreign oil,” said Obama. “Many of these companies were part of an agreement we reached two years ago to raise the fuel efficiency of their cars over the next five years. By 2025, the average fuel economy of their vehicles will nearly double to almost 55 mpg.”

Currently, the Corporate Average Fuel Economy (CAFE) standard calls for automakers to achieve an average of 35.5 mpg by 2016. The administration believes the new standards will save $1.7 trillion dollars at the pump and over $8,000 per vehicle by 2025 while reducing U.S. oil consumption by 12 billion barrels.

Under the plan, fuel efficiency will improve an average of 5% per year from 2017 through 2025 for cars and 3.5% for light-duty pickups and other light-duty trucks for model years 2017 through 2021 and 5% in 2022-2025.

The administration also released a detailed report, Driving Efficiency: Cutting Costs for Families at the Pump and Slashing Dependence on Oil, outlining the proposal and the environmental impact.

“This is another important step toward saving money for drivers, breaking our dependence on imported oil and cleaning up the air we breathe,” said Environmental Protection Agency administrator Lisa P. Jackson. “American consumers are calling for cleaner cars that won’t pollute their air or break their budgets at the gas pump, and our innovative American automakers are responding with plans for some of the most fuel efficient vehicles in our history.”

The plan must still go through a formal rulemaking procedure. EPA and National Highway Traffic Safety Administration are working on a joint proposed rulemaking that will be published in the Federal Register upon completion, likely before the end of September, EPA said.

“These standards will help spur economic growth and job creation, protect the environment, and strengthen our national security by reducing America’s dependence on foreign oil,” said U.S. Transportation Secretary Ray LaHood. “Working together, we are setting the stage for a new generation of clean vehicles.”

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